Check-Up: Seven fields of innovation for the digital future

KPMG emphasizes that the federal system of direct democracy is more relevant than ever in the age of participatory social media.

Professions based on knowledge and expertise are being revolutionized by cognitive systems, artificial intelligence and by means of process automation through software robots.

According to the study "Shaping Switzerland's digital future", disruptive forces include:

- The struggle for the customer:

In view of demographic developments, changing behaviour and expectations, companies must place customers more at the centre of their activities.

- The mobile economy:

Low-cost app devices linked via high-speed mobile and Wi-Fi connections and cloud computing will mobilize the economy.

- The Internet of Things:

Networked sensors in machines and other physical objects monitor, collect and transmit data between each other.

- Digitization of work:

Professions based on knowledge and expertise are being revolutionized by cognitive systems, artificial intelligence and by means of process automation through software robots.

- Platform Business Models:

Digital marketplaces and auctions will radically change existing business models in various industries - simplifying communication between business partners, reducing transaction costs and optimizing the use of resources and capacities.

Digitization began its triumphant march as the "4th industrial revolution" years ago. However, the focus of this development is in Silicon Valley. This is a disadvantage for the Swiss economy in that it can no longer independently decide on the most important developments, their future value contribution and ultimately the attractiveness of the business location. Accordingly, Switzerland must learn in the coming years how to deal with disruptive forces and make targeted use of them. In doing so, it can rely on its acknowledged strengths, but it must also resolutely tackle important fields of action.

Switzerland is able to deal successfully with these disruptive forces thanks to the established strengths of its business location:

These include political stability, direct democracy, strict data protection regulations, a modern and technology-savvy society, legal certainty, a competitive tax system, a highly qualified workforce, flexible labour laws, a high standard of living, and leading universities and activities in research and development.

But to maintain its attractiveness as a business location, Switzerland will also have to work on its weaknesses. These include high wage costs, an uncertain immigration policy in connection with the implementation of the mass immigration initiative, as well as the still obstructive tax conditions for start-ups and classic Swiss reticence.

Sustainable future for Switzerland

KPMG has identified seven areas of innovation that offer significant opportunities for Switzerland:

1. digital workbench

The global digital economy will generate a fundamentally new value chain. Outsourcing to low-wage countries is likely to become less attractive, as skills in technology areas such as data analysis will be in greater demand. Switzerland is in an excellent position to become a digital workbench for the global economy: These include its well-developed infrastructure and a high degree of stability, legal certainty and data protection. However, Switzerland needs to invest even more in education and research.

2. data trustee of the world

Data represents the currency of the digital age. Switzerland enjoys an international reputation as a trustworthy and reliable partner. Numerous data centres and other infrastructures are already located here today. In order for Switzerland to continue to position itself as a reliable data trustee in the future, policymakers must create the right framework conditions and find the necessary balance between data protection and the most open use of data possible.

3. fintech valley

Switzerland has what it takes to be a leader in the field of digital financial services: Years of experience in the banking and insurance sector combined with technological expertise. At the moment, however, developments in the fintech sector are concentrated too much on the small domestic market and are therefore still not perceived strongly enough internationally. The high wage costs - and the associated lower productivity - also mean that competitiveness is too low.

4. resistant industrial controls

Networked Industry 4.0 relies on functioning control systems and defense mechanisms. Without these security systems, there is a risk of disruptions and even catastrophes in the real world, for example through cyber attacks on critical infrastructures such as power plants. Local know-how in the field of cyber security is already among the world's best. Now we need to set the right liberal accents in education and migration policy in order to prevent a shortage of skilled workers in engineering.

5. robotics in healthcare

Technical progress in robotics and the increasing ageing of our society are two current, parallel developments. Demographics are leading to increased healthcare costs, which could, however, be reduced in the future through the increased use of robots in hospitals and care facilities. Switzerland has excellent research facilities in robotics, for example at the Federal Institutes of Technology in Zurich and Lausanne.

6 Switzerland as an incubator for great ideas

Human creativity, mediation between parties and constructive problem-solving approaches will also be in demand in the digital future, probably more than ever. Switzerland is already the location of various international organisations and events such as the UN and the WEF. In order for Switzerland to continue to develop its position as a neutral, creative hub under the changed conditions, international exchange between business, politics and science must continue to be intensively cultivated.

7 Direct democracy as an export good

The federal system of direct democracy is more topical than ever in the age of participatory social media. With "Democracy as a Service" (DaaS), Switzerland could be a role model for other countries and offer its successful model as an export article - especially in combination with new technology. However, for the sake of credibility, Switzerland must first make progress in the area of its own e-government and press ahead with the introduction of a national digital ID.

You can find out more about the study "Shaping Switzerland's digital future" at this Link